NEW YORK >> Stocks slumped today, at the start of one of the market’s historically worst months, ahead of data likely to influence how much the Federal Reserve will lower interest rates.

Market sentiment fell as Institute for Supply Management data today showed U.S. manufacturing remained subdued despite a modest improvement in August from an eight-month low in July.

September is widely regarded one of the worst months for stock market performance based on data stretching back to the 1950s, said Jason Browne, president at Alexis Investment Partners in Montgomery, Texas.

“We had a weak ISM report come out this morning, but we do believe seasonality is a big factor here especially when you’ve had such a solid performance for the year until the end of last month,” Browne said.

“Everybody is reporting about how September is such a horrible month and that tends to feed on itself.”

The so-called Magnificent Seven megacap technology stocks, which have led this year’s rally, slumped, led by Nvidia, Alphabet, Apple and Microsoft.

According to preliminary data, the S&P 500 lost 118.64 points, or 2.10%, to end at 5,529.76 points, while the Nasdaq Composite lost 576.06 points, or 3.25%, to 17,137.56. The Dow Jones Industrial Average fell 618.72 points, or 1.49%, to 40,944.36.

Traders are awaiting several labor market reports ahead of Friday’s non-farm payrolls data for August.

The Fed’s meeting later in the month will be closely observed following Chair Jerome Powell’s recent support for easing monetary policy.

Odds of a 25-basis point interest rate cut are at 63%, the CME Group’s FedWatch Tool showed, while those for a bigger 50 bps reduction are at 37%.

Tesla fell after Reuters reported that the electric vehicle maker plans to produce a six-seat variant of its Model Y car in China from late 2025.

Boeing dropped after Wells Fargo downgraded the planemaker’s shares to “underweight” from “equal weight.”